Election Outcome Will Determine if Some Businesses Drop Health-Care Coverage

Employers are divided as to whether or not they will continue providing health-care benefits to their workers leading up to the 2012 election. Although Obamacare was upheld by the Supreme Court, only about 50% of employers said they will move forward with their current benefits strategy regardless of the political outcome, according to a recent survey.

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Buck Consultants recently released a poll which found that only 2% of employers have decided to drop employer-sponsored health insurance, and 68.7% said they will continue to offer coverage into the 2014-2015 benefits year.

The health-care reform requirement that has businesses most concerned is the “Cadillac tax,” the survey found. This was ranked No. 1 by 36.5% of employers, despite the fact that this tax doesn’t go into effect until 2018. Other concerns included summary of benefits and coverage (19.6%), employer-shared responsibility penalty (22.9%), Form W-2 reporting (9.3%) and automatic enrollment (11.7%).

Buck surveyed 370 respondents to gauge their reaction to the ruling and how it will impact their benefits selection moving forward.

Tami Simon, managing director of Knowledge Resources for Buck Consultants, said business owners should be paying attention to certain key elements of the ACA in order to prepare for its implication.

No. 1: Summary of Benefits and Coverage. This summary will be required for all health plans at companies, and will be due on or after September 23, 2012, during the first open enrollment period. In order to prepare, businesses that are offering or planning to offer coverage should coordinate with enrollment and other vendors now, Simon said.

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No. 2: Form W-2 reporting. Employers will be responsible for reporting the aggregate cost of employer-sponsored health coverage, based on Dec. 31st information and using COBRA calculation methods. This rule will not apply to those employers issuing less than 250 Form W-2s, Simon said. To prepare, Simon said to begin determining what coverage you will have to report.

No. 3: Employer-shared responsibility. Those companies with 50 or more employees will be responsible for offering coverage, or face a $2,000 penalty per-employee annually if no coverage is offered. To prepare for this portion of Obamacare, Simon said to consider your employee population and benefit needs, and compare costs for offering coverage versus penalties. Also follow your state’s progress in setting up a health-insurance exchange.